How to Make a Major Purchase With Poor Credit and Zero Down
Determine your credit score prior to applying for a loan., Analyze and repair your credit score., Contact potential creditors to determine their credit requirements. , Communicate with your loan agent., Provide a written explanation of any problems...
Step-by-Step Guide
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Step 1: Determine your credit score prior to applying for a loan.
In the United States, there are 3 credit reporting agencies that keep track of your payment history.
Your credit score is a combination of the 3 agencies.
This score is often referred to as your Fair Isaac Company (FICO) score.
Retrieve a tri-merge credit report or get a credit report from each of the 3 reporting agencies.
A tri-merge report is a credit report that includes scores from all 3 agencies in 1 report. -
Step 2: Analyze and repair your credit score.
Ask for a loan only if your credit score is 600 or above.
Repair your credit prior to asking for a loan or making a major purchase if your score is under
600.
Every time you ask for a loan, the loan company makes an inquiry into your credit score.
Each inquiry will lower your credit score.
Dispute any inaccuracies in your credit report.
After the inaccuracies are corrected, your score should be higher. ,, If your financial status has recently improved enabling you to pay off old debts and make timely payments, tell your loan agent. ,, These major purchases could be a vehicle, a kitchen appliance or a home.
Obtain a zero-down vehicle loan by using a trade-in vehicle.
If your trade-in vehicle is in fair to good condition, it can be used to purchase another vehicle without a down payment.
Accept a high interest rate, rather than putting money down on a major purchase.
Apply for a credit card from a company that specializes in rebuilding credit.
Use the credit card to purchase the item you want.
Ask a family member or friend who has good credit to co-sign on a major purchase loan or home loan. -
Step 3: Contact potential creditors to determine their credit requirements.
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Step 4: Communicate with your loan agent.
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Step 5: Provide a written explanation of any problems in your credit history.
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Step 6: Make a major purchase with poor credit and no down payment.
Detailed Guide
In the United States, there are 3 credit reporting agencies that keep track of your payment history.
Your credit score is a combination of the 3 agencies.
This score is often referred to as your Fair Isaac Company (FICO) score.
Retrieve a tri-merge credit report or get a credit report from each of the 3 reporting agencies.
A tri-merge report is a credit report that includes scores from all 3 agencies in 1 report.
Ask for a loan only if your credit score is 600 or above.
Repair your credit prior to asking for a loan or making a major purchase if your score is under
600.
Every time you ask for a loan, the loan company makes an inquiry into your credit score.
Each inquiry will lower your credit score.
Dispute any inaccuracies in your credit report.
After the inaccuracies are corrected, your score should be higher. ,, If your financial status has recently improved enabling you to pay off old debts and make timely payments, tell your loan agent. ,, These major purchases could be a vehicle, a kitchen appliance or a home.
Obtain a zero-down vehicle loan by using a trade-in vehicle.
If your trade-in vehicle is in fair to good condition, it can be used to purchase another vehicle without a down payment.
Accept a high interest rate, rather than putting money down on a major purchase.
Apply for a credit card from a company that specializes in rebuilding credit.
Use the credit card to purchase the item you want.
Ask a family member or friend who has good credit to co-sign on a major purchase loan or home loan.
About the Author
Arthur Harris
Arthur Harris has dedicated 10 years to mastering lifestyle and practical guides. As a content creator, Arthur focuses on providing actionable tips and step-by-step guides.
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